Amendment to Gas Purchase Agreement Between Dominion Black Warrior Basin, Inc. and El Paso Merchant Energy, L.P. (July 1, 2002)

Summary

This amendment updates the Gas Purchase Agreement originally made on May 3, 1994, between Dominion Black Warrior Basin, Inc. (Seller) and El Paso Merchant Energy, L.P. (Buyer). Effective January 1, 2003, it revises the pricing structure for natural gas, establishing fixed and index-based prices for specified quantities through 2003, and modifies the agreement's exhibit detailing monthly quantities. All other terms of the original agreement remain unchanged.

EX-10.1 3 d01202exv10w1.txt AMENDMENT TO GAS PURCHASE AGREEMENT EXHIBIT 10.1 AMENDMENT DATED JULY 1, 2002 TO THE GAS PURCHASE AGREEMENT DATED MAY 3, 1994 THIS AMENDMENT (the "July 2002 Amendment") is made and entered into as of the 1st day of July 2002, between Dominion Black Warrior Basin, Inc. ("Seller") and El Paso Merchant Energy, L.P., successor-in-interest to Sonat Marketing Company L.P. ("Buyer"). WITNESSETH WHEREAS, Buyer and Seller entered into a Gas Purchase Agreement dated May 3, 1994, as amended by Amendments dated April 1, 1996, May 16, 1996, April 9, 1998, July 1, 1999, July 1, 2000 and July 1, 2001 (the "1994 Agreement"); and WHEREAS, Buyer and Seller desire to further amend the 1994 Agreement to establish index prices and a fixed price for certain specified quantities; NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein, the parties hereby mutually understand and agree as follows: 1. Effective as of January 1, 2003, Sections 4.1 and 4.3 of the 1994 Agreement shall be deleted in their entireties and the following Sections 4.1 and 4.2 shall be substituted therefor: 4.1 The price payable by Buyer for each MMBtu of Monthly Base Quantity purchased hereunder during each month of the calendar year 2003 shall be divided into two categories, the price applicable to the Fixed Price Quantity and the price applicable to the Index Price Quantity, as those quantities are described in Revised Exhibit D hereto. The price for each MMBtu of Fixed Price Quantity shall be $3.68 per MMBtu (the "Monthly Fixed Contract Price"). The price for each MMBtu of Index Quantity (the "Index Quantity Price") shall be the sum of (a) the price published in the price table dated the first (1st) day of the applicable month by Inside F.E.R.C.'s Gas Market Report for "Prices of Spot Gas Delivered to 1 Pipelines" "Southern Natural Gas Co." "Louisiana" "Index" (the "Index Price") and (b) a Premium per MMBtu as described below (the "Monthly Index Price"), multiplied by 0.9826 (conversion factor): Index Price Premium ($/MMBtu) ($/MMBtu) ----------- --------- Below 2.00 0.050 2.00 - 2.25 0.060 2.26 - 2.50 0.065 Above 2.50 0.070 Gas purchased during each month shall be deemed to be Fixed Price Quantity until the Fixed Price Quantity has been delivered. Commencing January 1, 2004, the Index Quantity Price shall apply to the entire Monthly Base Quantity. 4.2 The price payable by Buyer for each MMBtu of Excess Quantities sold under this agreement commencing on January 1, 2003 and thereafter shall be the sum of the Index Price and $.02 per MMBtu (the "Excess Quantity Contract Price"), multiplied by 0.9826 (conversion factor). 2. Exhibit D is deleted in its entirety and the attached Revised Exhibit D is substituted therefor and is effective during calendar year 2003 only. 3. Except as amended hereby, the 1994 Agreement remains in full force and effect. 2 IN WITNESS WHEREOF, the parties hereto have executed this July 2002 Amendment in duplicate originals as of date hereinabove first written. Witness: EL PASO MERCHANT ENERGY, L.P. By /s/ TIMOTHY D. BOURN - ----------------------------- ------------------------------------- Timothy D. Bourn President Witness: DOMINION EXPLORATION & PRODUCTION, INC. EXECUTING AS SPECIAL AGENT AND ATTORNEY IN FACT FOR DOMINION BLACK WARRIOR BASIN, INC. By /s/ DENNIS G. MILLET - ----------------------------- ------------------------------------- Dennis G. Millet Vice President, Gas Marketing 3 REVISED EXHIBIT D DATED JULY 1, 2002 TO THE GAS PURCHASE AGREEMENT BETWEEN DOMINION BLACK WARRIOR BASIN, INC. AND EL PASO MERCHANT ENERGY, L.P., SUCCESSOR-IN-INTEREST TO SONAT MARKETING COMPANY L.P. DATED MAY 3, 1994